OPERS Combined Plan Retirement: Distribution Steps and Deadlines

Three Plans, Three Retirement Paths

OPERS runs three retirement plan structures, and retiring under each one works differently. Most members are in the Traditional Pension Plan — a defined benefit plan where your monthly check is calculated by formula. But if you chose the Combined Plan or the Member-Directed Plan when you were first eligible, your retirement process has extra moving parts.

The Traditional Pension Plan is straightforward: OPERS calculates your benefit using your Final Average Salary, years of service credit, and the 2.2% multiplier. You pick a plan of payment and start receiving monthly checks.

The Combined Plan is a hybrid. Part of your benefit comes from a smaller defined benefit pension (calculated by a reduced formula), and part comes from a defined contribution account you've been investing throughout your career. When you retire, you execute two separate distribution elections — one for each side.

The Member-Directed Plan is purely defined contribution. There's no formula-based pension at all. Your retirement balance is the sum of employee and employer contributions plus investment gains or losses. You choose between a lump-sum refund, a rollover, or purchasing an annuity from OPERS.

The Combined Plan closed to new hires on January 1, 2022, so no new members are entering it. But existing Combined Plan members still retire under its rules.

Retiring Under the Combined Plan

If you're in the Combined Plan, here's what happens at retirement:

The defined benefit side uses the same transition group eligibility rules as Traditional — your group (A, B, or C) determines your unreduced retirement age and whether your Final Average Salary uses the three-year or five-year window. The multiplier is smaller than in Traditional because a portion of employer contributions went to your defined contribution account instead of funding the pension formula.

The defined contribution side gives you several options. You can take the balance as a lump sum (subject to 20% mandatory federal tax withholding if paid directly to you), roll it into an IRA or another qualified plan, purchase a lifetime annuity through OPERS, or combine these options. A direct rollover into the Ohio Deferred Compensation 457(b) plan avoids the 20% withholding on the transfer. Distributions from a governmental 457(b) plan generally avoid the 10% early-distribution tax, except for amounts attributable to rollovers from another plan or an IRA; check how rolled-in funds are tracked before planning an early withdrawal.

You make separate retirement payment elections for the defined benefit and defined contribution portions. Review both portions on your application so you know how each benefit will be paid.

Member-Directed Plan Distribution

Member-Directed Plan members become eligible to access their account balance at age 55, regardless of years of service. There's no defined benefit pension component, so the distribution election is the entire retirement event.

The same options apply: lump sum, rollover, annuity purchase, or a combination. Because there's no monthly pension formula, Member-Directed retirees who want lifetime income can use part of the balance to buy an annuity and roll the rest into a tax-deferred account for flexibility.

Member-Directed Plan participants don't have access to the Partial Lump-Sum Option Payment (PLOP) — that's a Traditional and Combined Plan feature tied to the defined benefit formula.

Switching Plans Before Retirement

OPERS allows one retirement-plan change during a member's career; it is not limited to periodic transfer windows. The Combined Plan closed to new hires on January 1, 2022. If you change out of Combined, a move to Traditional can be prospective or include purchasing plan-change service credit; a move to Member-Directed is prospective. If you do not purchase Combined service credit in Traditional, the benefits already accrued under Combined remain administered under that plan. Ask OPERS which plan-change options apply to your account before making a decision.

Health Care Eligibility Across All Three Plans

Traditional and Combined Plan retirees may qualify for the OPERS Health Reimbursement Arrangement under age-, group-, and service-based rules. At age 65 or older, the threshold is 20 years of qualifying health care service credit. At ages 60–64, members need 20 health care years plus 30 total service years in Group A, 31 in Group B, or 32 in Group C. Under age 60, the thresholds are 30 health care years for Group A; 32, or 31 at age 52, for Group B; and 32 plus age 55 for Group C. Member-Directed Plan participants do not have access to the OPERS health insurance program, but may use vested funds in a Retiree Medical Account to reimburse qualified health care expenses.

The full breakdown of plan of payment options, PLOP mechanics, and health care transition steps is in the OPERS Retirement Guide.

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